United Rentals buys BakerCorp, enters European market for first time

Marcia Gruver Doyle Pix
For rent: BakerCorp steel tanks.For rent: BakerCorp steel tanks.

In a move that expands its already massive presence in the trench shoring market, United Rentals has acquired BakerCorp International Holdings for $715 million. The transaction is expected to be finalized in the third quarter of this year.

With around 950 employees, BakerCorp serves an estimated 4,800 customers in North America and Europe, with operations primarily concentrated in the United States and Canada. The company has 46 locations in North America and 11 locations in France, Germany, the United Kingdom and the Netherlands. BakerCorp generated $79 million of adjusted EBITDA at a 26.9 percent margin on $295 million of total revenue for the 12-month period ending May 31st, according to the release.

BakerCorp’s range of rental fluid solutions goes into a variety of heavy markets, including oil and gas, pipeline, refinery and construction. It also offers products for environmental remediation and municipal markets.

The trench shoring part of BakerCorp, however, appears to have been a smaller consideration for United Rentals than the company’s main businesses—providing tank, pump and filtration rentals for a broad range of industrial and construction applications. In a release on the acquisition, United Rentals emphasizes this end of the business as “creating an enhanced value proposition for customers across the broader fluid solutions space.”

United Rentals also found BakerCorp’s European foothold attractive, since BakerCorp’s international operations made up 15 percent of its total revenues. Michael Kneeland, United Rental’s CEO, says the transaction will be “our company’s first experience in Europe, where BakerCorp has established an attractive, fast-growing business with significant future opportunity.”

United Rentals says it bought BakerCorp because it has “created strong, blue-chip customer relationships” and that the “combined company will serve a larger strategic account base with a broader fleet range.” BakerCorp now has approximately 24,000 units in its fleet. The acquisition will provide growth through “cross-selling, re-rent conversion and scale,” says United Rentals.

United Rentals says it will combine the BakerCorp fluid storage, transfer and treatment business with its Pump Solutions unit.

BakerCorp also offers a variety of steel and aluminum trench shields, along with hydraulic shoring and slide rail trench protection systems, boosting United Rentals presence as the largest U.S. player in trench safety rentals.

According to the United Rental’s 2017 annual report, rental revenues from the company’s combined trench, power and pump segments grew 27.5 percent between 2016 and 2017, to a total of $988 million. (Note: Hurricane-related revenues on the power and pump side affect these results.) Market estimates now put the entire U.S. trench shoring industry at between $1.1 billion to $1.5 billion in annual sales.